iPhone Mail Setup issues

I had configured my iPhone to access my corporate mails through Microsoft Exchange server (Office 2003 server and it uses RPC type connection). At first I was able to access my mails, but in my organization it is mandate to change the password every 60 days. So I changed my password word and tried to do the same in my iPhone. It connected to the email initially with my new password. After that when I check my account settings in iPhone it still shows the old password and it tries to connect to the mail and then locks my account. I tried following things

1. Deleting the email account and recreating the new one but it still shows the same old password even though I give the new password while I setup the account.

2. Deleting the email account and then Resetting the network settings to factory setting and creating the new email account again with new password but it still connects with the old password and locks my account.

I do not want to restore my iPhone with the option in iTunes and also do not want to use the erase all the settings in iPhone. Please help me to resolve this issue as soon as possible. Thanks in advance. I am using iPhone 2.2.

I think you should reset your phone. You also get a manual with iPhone and so you can have a look at that as they have explained it all. There is also this website by Apple:
manuals.info.apple.com/en/iPhone_User_Guide.pdf
You can definitely find a solution here.